Pulpi is a financial digital platform providing flexible financial solutions through payroll deductible loans and earned wage advances to Mexican employees. We sat down with Carlos Ramírez de Agular, CEO and Co-Founder, to talk about Pulpi’s work during (and after) the pandemic, as well as their recent addition to the Percent Platform.
Pulpi began in 2020 during the pandemic. How were you able to launch a company during such an unprecedented time?
Launching Pulpi at the start of a world pandemic was a big challenge. We had the challenge of validating, developing, and testing a product with everyone in complete lockdown, while at the same time trying to mitigate the crisis with existing clients. It was definitely a struggle to keep focus on the huge task ahead since everything that was happening was constantly in everyone’s mind. But that did not stop us one bit. We were able to put the blinders on and get to work, knowing that the timing could not be better. People would need the product we were developing more than ever. In the end, the Pulpi team delivered with incredible speed, and it was clear to us that if we made it through this whole process in an environment like that, we would, for sure, succeed.
We think of the pandemic as a breaking point, especially in how employees and employers relate. Before we launched, we noticed that employees were demanding more from their employees. We took the opportunity to partner with companies to try and free their employees from the financial stress that was more present than ever, seeping into people’s mental and physical health. This required getting employees to actively and collectively request their employers to offer our service, as there was a true, genuine need for it.
As many faced employment and economic uncertainty in 2020, how did Pulpi’s platform help employees and employers in Mexico?
For the longest time, a huge sector of Mexico’s population has had no solid financial products that they can turn to in times of need. Most alternatives are either informal and unsafe or very expensive. When many employees were having economic uncertainty about their future or even having their pay reduced, they could find, in Pulpi, a breath of fresh air for a reasonable price. For employers, the introduction of Pulpi and other similar companies signaled it was the right time to look for additional benefits for workplaces and their employees. Our product has helped them reduce their turnover and increase productivity simply by reducing financial stress.
How is Pulpi addressing Mexican workers’ lack access to simplified liquidity solutions?
A lot of people are confused or even scared to look into financial solutions to their liquidity problems, and they’re right to be. The way these products have been presented in the past aimed to confuse employees into a whirlwind of debt with huge interest rates. We make it simple and fair precisely because our business model allows for it.
What do most investors (and workers) get wrong about payroll deductible loans?
There is a widely held opinion that payroll deductible loans are expensive and not beneficial for the worker. And this has been true for a long time in Mexico, even when the margins were huge, interest rates would be advantageous. This makes no sense, because the nature of this model allows for low cost financial solutions. By having our loans be payroll deducted, we decrease delinquency risk so we can give better conditions to the employee. We are focused not only in solving the liquidity problem, but offering a better alternative, too.
This is the new generation of payroll deduction. One in which the employee has options and is well informed. This empowers the worker to leverage their earned wages as a financial tool and payment method.
How has Pulpi benefitted from partnering with Percent?
By partnering with Percent, Pulpi can expand and offer more employers and employees the liquidity they need. We feel that having recognition of our business practices from an international institution such as Percent validates our efforts. We are also convinced that once we deliver results for international investors, we will be doing our part in solidifying trust in the region in the eyes of the world.
How does Pulpi harness technology to help Mexican workers?
We use our proprietary technology to make things simple for the user and have our solution reach thousands of employees. A lot of our users are having their first experience with financial products like ours, so for us it is extremely important to make it simple and straightforward while at the same time addressing their concerns and helping them along the way. Our app serves that purpose perfectly, effortlessly onboarding a greater number of users every month and giving them access to services based on their needs. Once they use our solution for the first time, they don’t have to worry about paying up and keeping track of everything. Thanks to the infrastructure we’ve developed, debts are paid by their employer seamlessly and our users can check their wages and movements instantly.
What future developments are you looking forward to most?
We want to expand our offering to meet more of our customers’ needs. We want to help users leverage their earned wages to unlock access to an array of products and services. Investing, savings, insurance, and retail products are just some of the options that our users could acquire with their future paychecks as a payment method. At the same time, this would allow companies to offer benefits without having to look for many different providers.
On the other hand, companies can also benefit greatly from financial tools we could provide. Recent changes in labor regulation in Mexico have made maintaining a workforce a lot more expensive than it used to be. Companies that already benefit from having Pulpi as the bridge between their employees and their future wages can trust Pulpi to give them more financial leeway when paying wages. This usually requires a lot of financial firepower, and Pulpi plans on growing these capabilities constantly.